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Medtech Companies Plagued with Layoffs
Much like 2023, this year has started with an onslaught of industry layoffs, including Livanova, Cue Health, Illumina, Globus Medical, and Zimmer Biomet.
February 12, 2024
5 Min Read
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At a Glance
- Most of those affected by the layoffs at Livanova are connected to the company’s closing ACS business unit.
- After multiple layoff rounds in 2022 and 2023, Cue Health starts 2024 with two reported layoffs in January.
- Globus Medical layoffs have reignited integration concerns which plagued the NuVasive merger when it was first announced.
Continuing the unfortunate trend of medtech layoffs that saw its peak in 2023, multiple companies have recently announced cuts to staffing, including Livanova, Cue Health, Illumina, Globus Medical, and as recently as last week, Zimmer Biomet.
Livanova Cuts 137
LivaNova, which employs approximately 2,900 employees in more than 100 countries, reported in early January that it would be immediately closing its advanced circulatory support (ACS) business unit in Pennsylvania to “increase the company’s strategic focus on its core cardiopulmonary (CP) and neuromodulation business units. The wind down is anticipated to be complete by the end of 2024,” according to a company statement.
During the announcement, Livanova did not disclose how many positions would be affected by the closure, however more recent estimates put the layoffs at 137 with the “majority” of cuts happening at the Pittsburgh facility — including both in person and remote workers, according to the Jan. 8 WARN Notice.
The company said it will provide additional details on the restructuring plan during its Feb. 21 earnings call.
Cue Health’s continued layoff woes
Partnerships with the Department of Defense and Google to supply COVID-19 tests first skyrocketed Cue Health into the medtech big leagues during the pandemic. However, when demand for tests started to wane in late 2021, the company began a series of layoffs that continued from 2022 through to as recently as last month.
In January, Cue announced two rounds of layoffs, the first on Jan. 4 affecting 94 employees, and the second on Jan. 25 affecting 151 employees — a quarter of the company’s reported workforce. The cuts include several machine operators at its production facility in Vista, CA, as well as managers, researchers, and even the head of talent acquisition and vice president of investor relations, according to the WARN filing.
The layoffs will take effect through the end of March and are expected to cost the company from $5 million to $7 million in one-time expenses.
The layoff news came in tandem with a report stating that the company’s FDA submission for its Flu A/B + COVID-19 molecular tests for over the counter and point-of-care use was denied for emergency use authorization.
“The letter indicates that the FDA has determined that further review of Cue’s EUA request is not a priority, and therefore declines to issue an EUA for the product at this time,” the company said in an SEC filing. “The letter states that the decision is based on review of the submission thus far, including significant issues identified, FDA priorities relating to the COVID-19 testing landscape, and the anticipated FDA resources needed to continue review of the EUA request.”
Illumina to axe 111
Illumina, after fighting a costly battle to acquire Grail — which it ended up having to divest after buying it in August 2021 without antitrust approval — recently announced plans to permanently lay off 111 employees from its San Diego, CA, headquarters, effective March 12, according to the WARN notice.
Positions being eliminated include senior managers, supervisors, engineers, scientists, and analysts. Specifically, cuts include the director of medical affairs, senior director of scientific research, vice president of scientific research, the R&D program management office.
Alleged Illumina employees vented their frustrations about the layoffs on thelayoff.com, highlighting their skepticism on reported “macroeconomics” cited by the company for the layoffs.
“So sorry to everyone impacted today,” one commenter wrote. “Leadership keeps blaming macroeconomic forces, but these don’t seem to have changed since 2022. Once [COVID-19] ended we should predict normal global events. [Because] these macroeconomic forces aren’t ever going to stop!!!!”
Another wrote, “Gotta blame something… macroeconomic RIF [reduction of force]. 100 hardworking PEOPLE lost their jobs today… and we still haven’t received an apology from leadership (current and past) for the Grail disaster. This company views people as expendable pawns, and it’s clear they don’t know how to forecast properly. It’s a sad, sad day at Illumina [which] once was a bright and promising company.”
Integration ghosts haunt Globus post-NuVasive deal
Only five months after Globus Medical and NuVasive completed its $3 billion all-stock merger, the company is now laying off 157 positions at NuVasive’s former headquarters campus in San Diego. The layoffs, which were first reported on by MD+DI at the end of January, have reignited integration concerns which plagued the deal when it was first announced last year, sparking memories of past deals in the spine market that had difficult integrations and considerable sales force disruptions due to cultural differences, according to a past Pedersen’s POV.
The Jan. 3 WARN notice includes positions across the campus like administrative, sales, legal, marketing, quality, and engineering jobs. The cuts will be effective March 5.
Zimmer Biomet cuts 3%
Zimmer Biomet last week announced it would engage in layoffs, cutting about 3% of its more than 18,000 positions — around 540 employees — as part of the company’s restructuring program which is set to save nearly $100 million a year for the next two years.
Ivan Tornos, Zimmer Biomet’s president and CEO, said, according to a Seeking Alpha transcript, “In terms of the restructuring, the reductions that we announced this morning, these are happening in back office. I will tell you virtually all reductions are non-customer facing. And again, the changes we make in inventory and people are embedded in the guidance that we're giving.
In an email to MD+DI obtained when the announcement was first reported on Friday, a spokesperson for the company wrote, “In order to create and sustain a framework of operational excellence across Zimmer Biomet, we are making changes to further enhance our execution, commercial focus, and how we collaborate. We will be reallocating investments and resources to best position the company for long-term growth.”
Despite the layoffs, Suky Upadhyyay, company CFO & EVP of finance, operations, and supply chain, said it would not interfere with acquisition plans. “… does this imply some deterioration in M&A targets? And I would say absolutely not,” she said, according to a Seeking Alpha transcript.
About the Author(s)
Managing Editor, MD+DI
Katie Hobbins is managing editor for MD+DI and joined the team in July 2022. She boasts multiple previous editorial roles in print and multimedia medical journalism, including dermatology, medical aesthetics, and pediatric medicine. She graduated from Cleveland State University in 2018 with a bachelor's degree in journalism and promotional communications. She enjoys yoga, hand embroidery, and anything DIY. You can reach her at [email protected].
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